Monday, March 01, 2010
7:48:11 PM EDT

Buying Breakouts?

by
Jim Brown

On Sunday night I developed a list of potential plays for the week with some criteria for when I would buy them. I was partial to tech stocks and was hoping to buy them on a dip. Several of the names I had listed to play this week were CTSH, SNDK, RVBD, JDSU, VRSN, FFIV and VMW. As I look through those charts today there are no candidates. Each spiked out of sight on today's Nasdaq rally.

SanDisk Chart

I would love to grab a couple Nasdaq names for tomorrow but not after the big jam job today. When you look at adding longs you don't want to add stocks that did not do well on a big day and you don't want to buy those that rallied 5-10%. That leaves us with very little to choose from.

I suspect a big fund went shopping for tech stocks this morning and created the monster short squeeze in the heavily shorted tech names. Since the majority of the gains were at the open that suggests the buy program was strong but short lived.

I am going to refrain from crawling out on the tech limb today and take a fresh look on Tuesday.